Ja­pan's econ­omy min­is­ter Aa­mari re­signs over graft scan­dal

The Pak Banker - - MARKETS/SPORTS -

Ja­panese Econ­omy Min­is­ter Akira Amari re­signed af­ter a week fend­ing off al­le­ga­tions he re­ceived money in re­turn for fa­vors. A tear­ful Amari apol­o­gized for the scan­dal, say­ing it had caused em­bar­rass­ment. He added any cash re­ceived by his of­fice was a political do­na­tion but he had to take re­spon­si­bil­ity for what hap­pened on his watch. He said his sec­re­tary had also re­signed.

"I de­cided to re­sign my cab­i­net po­si­tion to­day in con­sid­er­a­tion of my re­spon­si­bil­ity to over­see my sec­re­tary as a na­tional law­maker, my duty as a min­is­ter, and my pride as a politi­cian," Amari, 66, told re­porters in Tokyo. Nobuteru Ishi­hara, a for­mer sec­re­tary gen­eral of Prime Min­is­ter Shinzo Abe's Lib­eral Demo­cratic Party, will re­place him, na­tional broad­caster NHK re­ported.

Amari is the most in­flu­en­tial min­is­ter to step down since Abe took of­fice in De­cem­ber 2012. He was Ja­pan's point man in the Tran­sPa­cific Part­ner­ship re­gional trade talks, and spear­headed Abe's strat­egy to boost the na­tion's com­pet­i­tive­ness, known as "Abe­nomics." The an­nounce­ment prompted a brief rise in the yen be­fore it set­tled lit­tle changed at 118.71 against the dol­lar as of 6:19 p.m. in Tokyo. "The res­ig­na­tion of one of the lead­ing mem­bers in the Abe cab­i­net hurts the pol­icy im­ple­men­ta­tion ca­pac­ity of Abe­nomics," said Mi­nori Uchida, head of global mar­kets re­search at Bank of Tokyo- Mit­subishi UFJ Ltd. "It may be a rea­son to buy the yen and sell stocks." With the yen strength­en­ing to a one-year high last week, and ex­ports fall­ing faster than ex­pected in De­cem­ber, the res­ig­na­tion comes at a key time for Abe­nomics, which is aimed at pulling the world's third-largest econ­omy out of de­fla­tion. The loss of Amari may also prove a headache for Abe in the run-up to elec­tions in par­lia­ment's up­per house this sum­mer.

"In or­der to es­cape de­fla­tion and build a strong econ­omy, we need to pass the bud­get and re­lated im­por­tant bills as soon as pos­si­ble," Amari said. "We need to re­move any im­ped­i­ments to that and I am no ex­cep­tion."

Amari was re­spond­ing to an ar­ti­cle pub­lished in the weekly Shukan Bun­shun maga- zine last week that said he and his staff took money from an uniden­ti­fied Chiba pre­fec­ture­based con­struc­tion com­pany in an al­leged vi­o­la­tion of a political fund­ing law. The pay­ments amounted to at least 12 mil­lion yen (about $101,000).

A fol­low-up piece on Thurs­day said Amari twice pock­eted en­velopes con­tain­ing 500,000 yen in cash. Fur­ther un­recorded pay­ments were made, bring­ing the to­tal to tens of mil­lions of yen, the mag­a­zine said.

Dur­ing the briefing, Amari said he had no rec­ol­lec­tion of tak­ing cash. He said his sec­re­tary had given tes­ti­mony that money was re­ceived by his of­fice and dealt with as a political do­na­tion. The sec­re­tary, who had spent 3 mil­lion yen of the funds, had ac­knowl­edged tak­ing money, he said.

Amari is the fourth cab­i­net mem­ber to re­sign over al­le­ga­tions of fi­nan­cial im­pro­pri­ety. None were as im­por­tant to Abe as his econ­omy min­is­ter, who com­pleted tough ne­go­ti­a­tions with the U.S. over the TPP trade deal even af­ter bat­tling can­cer of the tongue. Amari had been ex­pected to travel to New Zealand for the sign­ing of the pact by the 12 coun­tries in­volved on Feb. 4.

Gains in Ja­pan's bench­mark Topix In­dex since Shinzo Abe's elec­tion in De­cem­ber 2012 Gains in Ja­pan's bench­mark Topix In­dex since Shinzo Abe's elec­tion in De­cem­ber 2012 "It's a mi­nus rather than a plus," said Yuji Saito, head of the for­eign-ex­change depart­ment at Credit Agri­cole SA in Tokyo.

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